New supply of retail real estate space in shopping malls is expected to rise 43% across seven major cities by 2027: JLL India

According to a report released by real estate consultant JLL India, the new supply of retail real estate space is expected to rise by 43% across seven major cities by 2027.

At the end of June 2023, the operational retail stock in the top seven cities (Delhi-NCR, Mumbai, Pune, Bengaluru, Kolkata, Chennai, and Hyderabad) was 89 million square feet. Delhi NCR has the largest amount of retail space in malls—28 million square feet—followed by Mumbai (17 million square feet) and Bengaluru (14 million square feet).

Over 38 million square feet of retail developments are anticipated to be built between the first half of 2023 and 2027, spread out among the top seven cities in the physical retail space segment. Delhi-NCR will have 11.6 million square feet, accounting for 31% of the expected supply.

By 2027, 4.97 million square feet will be added to the market in Bengaluru, 6.23 million square feet in Chennai, 5.48 million square feet in Hyderabad, 2.94 million square feet in Kolkata, 4.5 million square feet in Mumbai, and 2.32 million square feet in Pune. In the first half of 2023, the gross lease of retail space in the top seven cities' malls and premier high streets was 3.16 million square feet.

According to Mr. Rahul Arora, Head of Office Leasing Advisory and Retail Services, India, JLL, India's retail industry is experiencing rapid growth, with an emphasis on developing unique built environments, strengthening consumer relationships, and curating actual shops in underserved areas of the nation, such as tier II and III cities.

Mr. Manoj Gaur, Chief Managing Director, Gaurs Group, stated that retail locations are currently benefiting from extensive residential construction. Positive worldwide perceptions, strong growth potential, rapid economic advancement, and upbeat investment emotions are the major drivers of this trend.

According to Mr. Vinod Rajpaul, Chief Executive Officer (CEO), Ocus Group, the retail organization is expanding. Mall traffic has significantly increased, especially since the COVID-19 pandemic. In major cities, there is a shortage of high-quality retail space. The high demand has also resulted in a hardening of lease rentals.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.